* Back in January, the Chicago Tribune editorial page absolutely blasted state Rep. Tom Morrison for his pension reform vote…

Timid lawmakers reached hither and yon to find reasons for not supporting reform legislation: This proposal is too strong, that proposal is too weak, and so on — whatever it took to avoid decisive action.

Among the most maladroit: state Rep. Tom Morrison, a conservative Republican from Palatine, who ran for office on a platform of … pension reform. We endorsed Morrison wholeheartedly — and then he voted Monday in committee against the only serious, cost-cutting pension reform measure that had any momentum. He evidently thought it didn’t go far enough. In other words, pension reform champion Morrison had found his reason to oppose pension reform!

In the House, divisions appeared in the Republican caucus. State Reps. Tom Morrison, R-Palatine, and Jeanne Ives, R-Wheaton, introduced a pension bill that would shift government workers into 401(k)-style plans and freeze the state’s defined benefit program going forward.

It’s a laudable idea advanced by the Illinois Policy Institute, a right-leaning think tank. The sponsors say it would cut almost in half the state’s $96.8 billion unfunded liability in the next fiscal year and save roughly $2 billion in spending.

But the two sponsors are waiting for … a third sponsor. They have garnered scant support, and they have created the risk that lawmakers will use this bill as an excuse to peel off of the consensus slowly building for the package proposed by Biss, Rep. Elaine Nekritz, D-Northbrook, and House Minority Leader Tom Cross, R-Oswego.

Remember your Voltaire: Don’t let the perfect be the enemy of the good.

* Rep. Ives responded…

I greatly appreciate that the Chicago Tribune Editorial Board, in their article, “On the Road to Nowhere,” recognized the merit of HB 3303, the pension reform plan put forth by Rep. Tom Morrison and me.

As one of the major daily newspapers in the state, your advocacy and influence is powerful. For that reason, I respectfully request that you, reconsidered your position on state pension reform from “Get Something (Anything) Done” to “Get the Right Thing Done – Create Real Reform in Illinois.”

If it is “the perfect” vs. “the good” then why advocate for the lesser, simply because it is more popular or has bigger names signed to it? Do not abandon your challenge to fix the pension system for the good of those in the system and tax-payers.

Advocate for the plan that remove us, as a citizenry, from the system that has played heavily into creating the economic tragedy in which we currently find ourselves.

As Military Historian, John Keegan states, “Soldiers, when committed to a task, can’t compromise. It’s unrelenting devotion to the standards of duty and courage, absolute loyalty to others, not letting the task go until it’s been done.”

Oy.

Rep. Ives is a freshman who obviously isn’t here to learn. She’s here to teach.

If she was here to learn, she’d already know the serious fiscal consequences of moving to a 401(k) system. No more employee pension contributions into a gigantic legacy system which still somehow has to be dealt with, and new state Social Security employer payments. [ADDING: As a commenter points out, Ives’ bill would not necessarily require SS payments.]

If she was here to learn, she’d already know the necessity of compromise in a legislative environment. Nobody ever gets everything they want, so eventually people have to work together to do what can be done to fix as many problems as possible.

Tea partiers like Rep. Ives like to talk a lot about strict adherence to the US Constitution. Well, there’s also an Illinois Constitution and Rep. Ives is sworn to uphold it. I don’t know of anybody who has ever come up with any sort of argument that switching everybody into a 401(k) program is in any way or form constitutional. [ADDING: OK, Sidley and Austin does, but this is still an outlier position.]

Also, you’re not a soldier, Rep. Ives. You’re a legislator. Big difference. To compare yourself to a soldier is not only silly, but also insulting to actual soldiers, many of whom put their very lives on the line every day in service to our country and our Constitution.

=If she was here to learn, she’d already know the serious fiscal consequences of moving to a 401(k) system. No more employee pension contributions into a gigantic legacy system which still somehow has to be dealt with, and new state Social Security employer payments.=
This statement makes no sense.

Hard not to draw the corollary here. Ponzi schemes fail when you cannot get enough suckers to contribute. Pensions system cannot switch to a 401k because then there will be no more suckers contributing.

Puddles

Being a vet i completely agree with what Rich is saying. She is a politician when she is dealing with the IL House and those issues.

Please educate yourself so you don’t embarrass yourself. The system didn’t create the economic tragedy today. People like you stealing from it has created the problem with the pension system. Is this another one of those things that if you keep saying it often enough it might come true?

Tom Morrison and I. Press release writers please note. It’s not a big deal in casual conversation or a blog post or comment, but if you are going to make a public statement for release for a state elected official, please proofread.

===Well, there’s also an Illinois Constitution and Rep. Ives is sworn to uphold it. I don’t know of anybody who has ever come up with any sort of argument that switching everybody into a 401(k) program is in any way or form constitutional.===

From Rep. Ives - The QUOTE Rep. Ives CHOSE, on her own. - ===“Soldiers, when committed to a task, can’t compromise.===

Rep. Ives, it appears by her words, and her choice of quotes, has NO intention of trying to solve Illinois’ problems in a logical, thoughtful, rational, and honest manner.

Logical - the 401(k) thought and process of switching over is not an option that can pass muster, nor will it make economic sense for the state of Illinois in a “cost” move as a “stand alone” move for a cure. Instituional Knowledge … is something many Freshmen lack, and it appears Rep. Ives is one.

Thoughtful - Who uses a quote that allows themselves to be equated as a soldier. A soldier is a defender of the Constitution, faces real threats of death or harm in his/her actions, and uses PHYSICAL force to dictate the policies of the civilian goverment here in the United States. How is YOUR quote … thoughtful … to any soldiers, sailors, airmen, marine? You are a legislator in Illinois. You do not get up, eat Rations, Hike, or have any traits in your job that mirror anyone laying their lives on the line for Our Country. Thoughtful?

Rational - “If it is “the perfect” vs. “the good” then why advocate for the lesser, simply because it is more popular or has bigger names signed to it?” - There is an “Art” to compromise, without surrender, and getting what you want, while giving what other need in return. For someone, as Rich puts perfectly, who wants to “teach” us all, you know nothing about the “Art” which can lead to your “work of Art” as a blank canvas, while you whine and cry “Foul! Foul! Foul!” and those cries fall on deaf ears. Rational?

Honest - Is your 401(k) actually honest in how it can solve the crisis? Honest in its facts and how it can impact? Is it constitutional? You swore an Oath to defend the Illinois constitution, so are you being hinest with yourself and your Oath, given how you are “teaching” us to ignore the Institutional knowledge that seeps from the walls, but you choose to blatently ignore? Is this reall about YOU - RE. IVES? You question the integrity because ===…or has bigger names signed to it?===

Is it about YOU … or about Illinois …

Honest?

As you keep “teaching”, maybe some “lernin’” should be on YOUR agenda, and stop bringing down My Party as you are seen as a Grandtander, invoking yourself as a “soldier” all the while making it about YOU and not the bettterment of Illinois …

===…or has bigger names signed to it?===

There are many sad things, but claiming to be a “soldier” and making it about yourself is probably the saddest.

Puddles,
West Point is a crucible which, through a grinding four year process, identifies men and women with the intelligence, courage and charisma to lead soldiers. The best of these get the choice infantry and artillery positions which lead to further promotions. After graduation Rep Ives was assigned to supervise a platoon of truck drivers in Germany during the Gulf War. Draw your own conclusions…

=If she was here to learn, she’d already know the serious fiscal consequences of moving to a 401(k) system. No more employee pension contributions into a gigantic legacy system which still somehow has to be dealt with, and new state Social Security employer payments.=
This statement makes no sense. Private companies have converted from defined benefit to defined contribution plans and saved money all the time.
And most of those companies had unfunded liabilities. I don’t think you understand how this works.

Take out the other person–’the plan put forth by [I or me]’–clearly ‘me’, right? Or, substitute [we/us] and see which makes sense–’the plan put forth by [we or us]’–clearly ‘us’, right? I = we; me = us.

“This statement makes no sense. Private companies have converted from defined benefit to defined contribution plans and saved money all the time.”

That may well be true, but need to see some data. Can you name one *large* company (ie, $10 billion + in revenue) with a *large* (ie 10,000+ retirees) legacy pension class that actually saved $$ in the near term without running through a corporate re-organization of some sort?

Not that it matters, really, as *that* proposal has *no chance* of surviving the lititgation. None. *Clearly* unconstitutional (unless the bill also fires *everyone*).

I hate this as a reason to vote against something because, often, (not always), I think they are using it as an excuse.

Repubs want the income tax to go back to 3%. Let’s say some Dems wanted it down to 4% but still plenty wanted it at 5%, so repub votes were needed to lower it to 4%. Would repubs vote against a bill to lower the income tax rate to 4% because it doesn’t lower it to 3%? And thereby kill the bill? That seems silly to me.

Yeah, yeah, private companies save money all the time dumping pensions in favor of 401ks. In the meantime, they mess with their employees’ retirement plans doing that.

My father died a few months ago. That’s when my mother found out the company he retired from had dropped the $10,000 life insurance policy they told him was part of his retirement package. They did have a $3000 policy in place, which helped pay for things, but their plan had always been to use the 10K to pay for his funeral and other end-of-life expenses.

As a member of the Illinois General Assembly, Ives’ role as a Legislator, specifically, does not equate, specifically, to the task at hand.

The civilian government does NOT go on manuvers, nor are they in Peril as part of the description of Illinois state Representative.

While Rep. Ives may think her personal history allows for such a corollary in her mind, her role, as a member of the Illinois General Assembly, a civilian government, is based on laws and rules …and they are NOT equvilalent.

“In fact, both Nebraska and West Virginia experimented with shifting from a defined
benefit system to a defined contribution system and shifted back. The reason – simple.
The investment management fees, record-keeping fees, educational programs and other
administrative line items associated with a defined contribution system were substantially
greater than the cost under the old defined benefit system. The failed defined
contribution system didn’t provide enough income to live on and both Nebraska and
West Virginia experienced former state employees having to go on welfare.
The National Institute for Retirement Security reviewed this issue and made a very clear
finding, “for any given level of benefit, a defined benefit plan will cost less than a defined
contribution plan. This makes defined benefit plans, in the language of economists, more
efficient since they stretch taxpayer, employer and employee dollars further in achieving
any given level of retirement income.” Switching to a defined contribution plan from a
defined benefit plan will not solve Illinois’ public employee pension crisis or eliminate
the $54.4 billion current unfunded liability. It will, however, cost taxpayers more money
and result in public employees having less to live on.

=“for any given level of benefit, a defined benefit plan will cost less than a defined
contribution plan. This makes defined benefit plans, in the language of economists, more
efficient since they stretch taxpayer, employer and employee dollars further in achieving
any given level of retirement income.” Switching to a defined contribution plan from a
defined benefit plan will not solve Illinois’ public employee pension crisis or eliminate
the $54.4 billion current unfunded liability. It will, however, cost taxpayers more money
and result in public employees having less to live on.=
Using this rational would mean all private companies should switch to defined benefit plans to improve their bottom line.
And saying they would not have enough money to live on is pure nonsense.

== This statement makes no sense. Private companies have converted from defined benefit to defined contribution plans and saved money all the time. ==

Private companies are already paying into Social security for all their employees. By contrast, the State does not pay Social Security for four out of five employees in the state pensions. If the pension were abolished, then the State would have to start making the employer contribution, thus adding 6.5% to costs that companies don’t face. In addition, the State would no doubt contribute to the new 401(k), typically 3%, for a total contribution of 9.5%, which is higher than the average 85 pension contribution.

Mongo, stating employees would not have enough to live on is probably correct, if employees would continue to retire at age 55 with full benefits. If they work until age 65 before collecting full benefits, like most do in the private sector, most should be just fine.

I thought conservatives favored “strict construction” of the Constitution. Maybe that’s a principle they apply selectively.

Rich raises a good point I have yet to hear one of our friends on the right answer: If the Second Amendment is sacrosanct, and should not be emasculated by loose interpretation, then why shouldn’t the pension clause also be strictly interpreted???

I wonder is it possible to lock in benefits as of the date legislation goes in effect and then adjust future benefits. Is there any case law on that? Such as on x date if you have earned 30% of your final salary then the State must pay 30% of your final salary but going forward you earn 1% per year. As an example am not advocating that.

First, it does not help to compare businesses to states. They are different entities, with different missions, and are governed differently. A business can unilaterally drop bennies, reduce wages, layoff staff. States have to go through that pesky due process and tend to other constitutional requirements.

By the way I am not an expert on the def-ben switch to def-con. But I have seen enough about it to be a skeptic, and have legislator friends in other states who have not moved that way.

The other point addresses retiring at 55. I know a lot of state employees and the majority who retired at 55 (or 56, 57) did so as part of an ERI, not on their own. It would be really interesting to examine the effectiveness of ERI programs in general here.

To suggest that all teachers should have in this state is a 401k plan with no underlying safety net of Social Security for retirement security is an insult to all educators. It is unfortunate when legislators who are elected to represent all of their district decide to ignore those that have choosen a career in education. The policy institute testified carefully on this bill and only mentioned state employees, but the bill impacts all those in public pension systems. Mistake?

Downstater, business doesn’t have to provide food stamps or welfare when the defined contribution plan doesn’t cut it. The state subsidizes businesses who switch to a defined contribution plan by taking care of the folks those plans leave in poverty.

===As Military Historian, John Keegan states, “Soldiers, when committed to a task, can’t compromise. It’s unrelenting devotion to the standards of duty and courage, absolute loyalty to others, not letting the task go until it’s been done.”===

Reminds me of Cardinal Ximinez: Our chief weapon is surprise!… Surprise and fear… fear and surprise… Our two weapons are fear and surprise… and ruthless efficiency! Our three weapons are fear, and surprise, and ruthless efficiency… and an almost fanatical devotion to the Pope… Our four… no… Amongst our weapons… Hmf… Amongst our weaponry… are such elements as fear, surpr… I’ll come in again.

A little more about Rep Ives (R) and her leadership style and representative beliefs. Prior to the last election I had a cordial relationship with Rep Connelly (R) (before he moved to the Senate), and even though we had some differences on certain issues, he always responded to my concerns in a personal manner that made me feel my voice was at least being listened to. After Jeanne Ives was elected I had hopes of establishing a cordial relationship with her since she was my representative in the House. I sent her a very professional email expressing my concerns about important issues and asked her to reply with her thoughts to the concerns that are so vital to me. I received a mass-generated uncanny email from her (or someone in her office) that said nothing about my concerns and had 90 internet links for me to check out. For some reason I don’t get the feeling that my voice is being heard. It’s almost like the bumper sticker I saw recently … “I Respect Your Opinion - I Just Don’t Want To Hear It” - except in this case I don’t think she even wants to hear it.

I thought conservatives favored “strict construction” of the Constitution. Maybe that’s a principle they apply selectively.

“Rich raises a good point I have yet to hear one of our friends on the right answer: If the Second Amendment is sacrosanct, and should not be emasculated by loose interpretation, then why shouldn’t the pension clause also be strictly interpreted???”"

Not all people on the right believe contract law should be overturned, which is why so many of us had problems with the GM/Chrysler bailouts where holders of bonds had their claims negated. Do not make sweeping condemnations of the right, you may find you have sympathizers on this issue…

First things first, is this Ive’s language or her pal Proft’s and IPI’s?

Second, it appears that folks like Ive’s, Morrison(who’s actually a good guy) , Proft, Walsh, Kelly, Oberweis, etc. are more concerned about getting their names in the papers than serving their constituents and working as legislators.

Maybe being a radio personality is the “new” career path for these folks.

The gift that keeps giving to the Democrats continues indefinitely. Thank you GOP!

Liandro,
If Rep Ives wants to throw out her military service to make her point, that service is free to be examined and discussed. I was in the military. There are just as many, if not more, unqualified hacks there as anywhere else. I’m not saying anything about her service other than in a time of war, she was placed in a non-theater position that effectively blocked her career. Generally there is a reason for such actions.

You are disparaging anyone who has graduated from West Point as anything other than Infantry or Artillery, AND anyone who served stateside or non-theater during any conflict. I, too, was (am) in the military, and I am multi-tour combat vet.

Unless you can provide documentation for a problem, you are clearly disparaging someone’s military service, and you didn’t even put your name on it. Doing that, especially based purely off of broad assumptions, is pure hackery.

Rich: it simply is not true that moving to 401Ks requires contributing to Social Security. SURS already has a SS-exempt 401k plan. As do other states, like Alaska. Ives’ plan was based on the SURS plan and is SS-exempt.

==I don’t know of anybody who has ever come up with any sort of argument that switching everybody into a 401(k) program is in any way or form constitutional.==

Ives’ plan only applies to future, still-unearned service credit. Whether you agree with them or not, there have been multiple big-name firms (including Sidley Austin) who have concluded that only past benefit accruals are protected.